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Welcome to News & Events

Published on December 20, 2011, by in Industry News.

Welcome to The Fraud Practice’s FraudBlog; your source for updates on current events, commentary and best practices related to the eCommerce CNP payments and fraud industry.

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The Fraud Practice Releases New Free White Paper on the use of Issuer Alerts to Enable Higher Sales Conversion

Increasing Sales Conversion Through Issuer Alerts White PaperWhile most tend to focus on risk management tools and techniques that are applied before or during the point of transaction, our latest free white paper discusses the use of Issuer Alerts as a means of reducing chargebacks post-transaction, creating opportunities for organizations to focus more on sales conversion.

Issuer Alerts provide notification of transactions where the issuer intends to file a chargeback on behalf of the consumer. For these orders, the Issuer Alert provides organizations an opportunity to proactively respond and prevent a chargeback from occurring. This enables merchants to reduce the number of fraud and non-fraud related chargebacks, effectively lowering their chargeback rate while making no changes to the risk screening performed upfront. In doing so, the merchant can then weigh decisions on whether or not to be more lenient and let more orders flow, knowing that many of the chargebacks can later be avoided by proactively responding to Issuer Alerts.

The Fraud Practice’s new white paper, titled “Increasing Sales Conversion Through Issuer Alerts”, discusses the key concepts and considerations around Issuer Alerts for building this business case.

Request your free copy of this white paper

 
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Decline in Total Retail Sales Over Thanksgiving Weekend Followed by Largest U.S. Online Shopping Day Ever

In the four days from Thanksgiving to the following Sunday total U.S. retail spending declined, but eCommerce retail enjoyed strong growth over the holiday weekend and an even better Cyber Monday as it became the first time online spending in the United States eclipsed $2 billion in a single day.

Preliminary estimates following the largest five-day shopping period in the United States have a mix of good and bad news for retailers. According to estimates from the National Retail Federation (NRF), total spending in the U.S. over the Thanksgiving holiday weekend (Thursday to Sunday) fell 11 percent from 2013, but it could’ve been much worse if not for the continued growth of online sales. According to estimates from ComScore, eCommerce retail spending from PCs during the five-day period from Thanksgiving to Cyber Monday reached $6.56 billion, a 24 percent increase from 2013.

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Conversion Rates 3 Times Higher on Desktops Compared to Smartphones on Black Friday

A recent IBM Digital Analytics Benchmark report provides a plethora of great statistics about online and mobile traffic as well as shopping on Black Friday and Thanksgiving. While several notable findings emerge, these analytics reinforce trends that have been observed before: consumers are using smartphones to browser but tablets and PCs to buy, and iOS device users tend to shop and spend more from their mobile devices than Android users.

There is no denying that mobile commerce is continuing grow and represent a higher portion of total eCommerce sales in the United States, but the PC is still entrenched as the leading online sales vehicle. In IBM’s U.S. Retail Black Friday Report 2014 it is shown that mobile online traffic actually exceeded PC traffic on Thanksgiving and was about 50/50 on Black Friday, but more sales were closed on a computer than a mobile device.

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Using Social Media to Drive More Sales

Most eCommerce merchants have a social media presence these days, but not all are using it to their full potential. The Fraud Practice explores metrics around the use of Facebook and Pinterest to drive more sales along with a case study of a retailer increasing sales and revenue via Instagram.

Social media helps businesses grow their brand and presence in the marketplace, but measuring direct impact on sales can be more difficult.

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The Fraud Practice Offers Free White Paper and Webinar on Custom Modeling & Analytics for eCommerce Merchants

getting most out of consumer authentication with mobile data

The Fraud Practice is hosting a webinar at 1pm ET on December 4th accompanying the new white paper titled “Enabling Custom Modeling & Analytics for The Modern eCommerce Merchant” which will be released the same day. 

The eCommerce market has continued to mature over recent years to the benefit of both consumers and businesses that transact in this channel. As a result new markets and services have been created while existing markets have evolved and grown. Not long ago, any business seriously considering custom models would have found it expensive, timely and somewhat difficult to put in place, so the concept of implementing custom models was left for large financial and retail organizations that had the resources to afford the cost and teams that could support the models. This is no longer the case today, however, as the maturation and growth of these services has made custom modeling and analytics much more accessible and attainable to a far greater population of eCommerce merchants.

All who register for the live webinar will automatically receive a copy of the new white paper from The Fraud Practice prior to the webinar start time.

Register for the webinar and white paper

More information about the white paper

 

 
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Identity Document Verification as a Lowest Common Denominator Risk Management Technique

The Fraud Practice discusses common issues merchants face with stale or unavailable identity data when attempting to authenticate and verify a user online and how identity document verification can be applied as a “lowest common denominator” technique in the latest feature article.

Too often organizations associate identity document verification with the banking and financial services industry, KYC and AML compliance, and other applications where it is used as a primary risk screening and verification technique. It is important to consider, however, that many other online merchants can benefit from using identity document verification as a secondary form of screening only when required. Because of its global applicability and ability to provide an indication of risk when identity data is otherwise not available for a consumer, identity document verification is something organizations can fall back on as a lowest common denominator fraud detection technique.

Read the full article

 
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MasterCard and Visa to Upgrade 3D Secure Consumer Authentication, Stop Using Static Passwords

MasterCard and Visa are collectively working on a new authentication standard, currently being referred to as 3DS 2.0, which will make further use of cardholder data to reduce the need for authentication challenges. When a challenge is presented under the new protocol, it will rely on one-time-use passwords or biometrics rather than a static password.

3D Secure consumer authentication programs have yet to catch on in the United States to the extent they have in Europe and other regions, but the evolution to 3DS 2.0 may change that. Few details have been released to date on the plans, but already point to some meaningful implications with the 3DS 2.0 protocol co-created by MasterCard and Visa. One of the key initiatives is for 3DS 2.0 to “utilize richer cardholder data,” according to a MasterCard press release, “which will result in far fewer password interruptions.”

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Differentiating Data Analytics from Data Analysis

In an interview with ZDNet, Josh Sullivan, leader of the data science and analytics practice at Booz Allen Hamilton, discusses the importance of human analysis complementing machine analytics. While the focus is on big data for any application, the discussion and points made provide insights and important considerations very relevant to modeling and analytics for fraud and risk management.

While card issuers and financial institutions have long employed modeling and analytics as a fraud prevention technique it is now becoming more common among eCommerce merchants. As a result we are seeing much more talk about machine learning, neural networks and advanced statistical models in the risk management marketplace. Although custom analytic modeling risk services require sophisticated platforms and technology, the reality is that a human element is required to ensure these services continue to run effectively.

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Worldpay Acquires Multi-Channel Payment Provider SecureNet

Worldpay, the UK-based global payment provider, announced their acquisition of SecureNet in mid-November with the deal expected to close before the end of this year. SecureNet, a payment provider offering services for in-store payments, mobile point-of-sale payments and online payments, has over 17,000 merchant clients with annual processing volumes exceeding $19 billion.

This marks Worldpay’s second acquisition of another payments company in as many years following the purchase of Century Payments in 2013.

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© The Fraud Practice LLC 2012